[SMM Steel Market Morning Briefing] PBOC: Will Implement RRR Cuts and Interest Rate Cuts in Due Course Based on Domestic and Overseas Economic Conditions and Financial Market Performance

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MACRO

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[South Korea's Ministry of Trade, Industry and Energy: No Possibility of Reaching Trade Agreement with US Before June Election]

Deputy Minister Park Sung-taek of South Korea's Ministry of Trade, Industry and Energy stated that there is no possibility of reaching a comprehensive trade agreement with the US before the presidential election on June 3. At a press conference, he said that the ministry will send a delegation to Washington this week for working-level talks to follow up on last week's trade negotiations. Several working groups will be established to discuss details in areas such as tariffs, non-tariff barriers, economic security, investment, and exchange rates. Park said that due to political uncertainties, an agreement is only possible after early June. The trade ministers of both countries will hold talks during the visit of U.S. Trade Representative Jamison Greer to South Korea in mid-May for the APEC ministerial meeting.

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[Ministry of Finance: 437.5 Billion Yuan of New Bonds Issued Nationwide in March]

Data from the Ministry of Finance showed that in March 2025, 437.5 billion yuan of new bonds were issued nationwide, including 74 billion yuan of general bonds and 363.5 billion yuan of special-purpose bonds. Additionally, 541.3 billion yuan of refinancing bonds were issued, comprising 100.8 billion yuan of general bonds and 440.5 billion yuan of special-purpose bonds. In total, 978.8 billion yuan of local government bonds were issued, with 174.8 billion yuan of general bonds and 804 billion yuan of special-purpose bonds. By the end of March 2025, the outstanding balance of local government debt was 50,165 billion yuan. This included 17,022.5 billion yuan of general debt and 33,142.5 billion yuan of special-purpose debt; 50,004.6 billion yuan of government bonds and 16.04 billion yuan of non-government bond form of existing government debt.

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[Great Wall Strategy: April Political Bureau Meeting May Offer Incremental Policy Support for Domestic Circulation]

Great Wall Strategy released a report stating that the expressions at the April Political Bureau meeting were relatively in line with market expectations and maintained strong continuity with previous important domestic meetings, still emphasizing bottom-line thinking. However, within the "bottom line," there is a color of "increment." There was significant emphasis on technology and consumption. In terms of intensity and pace, it tends to be gradual rather than rapidly raising market expectations. On one hand, Sino-US relations currently do not show any marginal improvement, and we need to reserve policy tools to address potential risks. On the other hand, we also fully recognize and attach importance to the current economic pressure, aiming to ensure stable economic operation while promoting further technological breakthroughs to create new growth points. From an asset allocation perspective, it is still recommended to focus on dividend sectors, paying attention to the price patterns of major assets under the economic cycle. In the technology sector, sub-sectors such as semiconductor equipment, AI chips, optical communications, and servers, which are key growth points for the future economy, have upward industry trends and are supported by policies, making them worth close attention when their cost-effectiveness stands out.

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[PBOC: Will Consider RRR Cuts and Interest Rate Cuts Based on Domestic and Overseas Economic Conditions and Financial Market Operations]

Vice Governor Zou Lan of the People's Bank of China (PBOC) stated at a press conference held by the State Council Information Office on April 28 that the PBOC will consider RRR cuts and interest rate cuts based on domestic and overseas economic conditions and financial market operations, maintaining ample liquidity. It will leverage the dual functions of the monetary policy toolkit, create new structural monetary policy tools, and focus on key areas such as stabilizing employment and growth, providing financial support. The PBOC is also studying ways to enrich the policy toolkit and will introduce incremental policies at the appropriate time to assist in stabilizing employment, enterprises, markets, and expectations.

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INDUSTRY AND DOWNSTREAM

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[Shanghai Introduces New Housing Fund Policy for Flexible Employment Personnel Without Household Registration Restrictions]

The Shanghai Housing Fund Management Committee recently issued the "Implementation Measures for Voluntary Contributions, Withdrawals, and Use of Housing Funds by Flexible Employment Personnel in Shanghai," effective from June 1, 2025. According to the press conference, compared to the original "Implementation Measures for Contributions, Withdrawals, and Use of Housing Funds by Urban Individual Business Owners, Their Employees, and Freelancers in Shanghai," the new policy does not set household registration restrictions. Flexible employment personnel, regardless of whether they are local residents, non-local residents, or foreign nationals, can participate. Under the new policy, flexible employment personnel can make more flexible housing fund contributions. They sign an agreement with the city's housing fund center, specifying the contribution amount, method, and rights and obligations. Flexible employment personnel can determine their contribution base within a specified range and choose the contribution ratio. The monthly contribution equals the contribution base multiplied by the contribution ratio. According to the 2024 contribution standards, the minimum monthly contribution for flexible employment personnel is 270 yuan, and the maximum is 8,860 yuan. They can choose to contribute monthly, quarterly, or semi-annually. Contributions are made through regular deductions from personal bank cards. If flexible employment personnel cannot continue contributing due to changes in income, they can suspend contributions and resume when they are able to contribute again.

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[NDRC Zhao Chenxin: Aim to Issue Full-Year 'Two Major' Project Construction and National Central Budget Investment Project List by End of June]

Vice Chairman Zhao Chenxin of the National Development and Reform Commission (NDRC) stated at a press conference held by the State Council Information Office on April 28 that the NDRC aims to issue the full-year "two major" project construction and national central budget investment project list by the end of June. Additionally, a new type of policy-based financial tool will be established to address the issue of insufficient capital for project construction.

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[MOFCOM Sheng Qiuping: Establish Special Credit for Large-Scale Complete Equipment Exports to Support Foreign Trade Enterprises in Taking Orders]

Vice Minister Sheng Qiuping of the Ministry of Commerce (MOFCOM) stated at a press conference held by the State Council Information Office on April 28 that MOFCOM will work with relevant departments to strengthen trade and financial support, further expanding the coverage and scale of export credit insurance. Special credit for large-scale complete equipment exports and other support tools will be established to give foreign trade enterprises more confidence in taking orders. Financial institutions will be guided to increase financing support for foreign trade enterprises, leveraging the coordination mechanism for small and micro-enterprise financing to channel low-cost funds directly to small and micro-foreign trade enterprises. Efforts will also be made to optimize foreign exchange risk management tools for foreign trade enterprises.

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[SMM Coal and Coke Shipping] Total coal arrivals at ports 6.796 million mt

By port, total coal arrivals were 6.796 million mt, down 4% MoM. Guangzhou Port received 908,000 mt, accounting for 13% of total arrivals, down 34% MoM.

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[SMM Steel Shipping] Last week, Chinese steel port departures increased 1% MoM

Last week (April 19-25, 2025), global (excluding China) steel port departures totaled 2.4196 million mt, up 16% MoM. Chinese port departures totaled 32.9499 million mt, up 1% MoM.

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[SMM Iron Ore Shipping Data] Global shipments up 9.2% MoM, arrivals up 30%

Total global iron ore shipments were 34.2 million mt, up 2.88 million mt or 9.2% MoM. Shipments from Australia were 20.23 million mt, up 9.4% MoM; 16.79 million mt went to China, accounting for 83% of Australian shipments, up 6% MoM. Brazilian shipments were 7.22 million mt, down 0.4% MoM; 3.04 million mt went to China, accounting for 42.1% of Brazilian shipments, down 17% MoM. Non-mainstream mine shipments increased 21% MoM. Total iron ore arrivals in China were 28.06 million mt, up 6.46 million mt or 29.9% MoM, steady YoY. By variety, lump, fines, and pellets saw significant increases, but lump arrivals decreased slightly.

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OTHER HIGHLIGHTS

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⭕[PBOC Governor Pan Gongsheng Meets IMF Managing Director Georgieva, Exchanges Views on China-IMF Cooperation]On April 25, 2025, during the International Monetary Fund/World Bank Spring Meetings, PBOC Governor Pan Gongsheng met with IMF Managing Director Kristalina Georgieva. They exchanged views on China-IMF cooperation. Deputy Governor Xuan Changneng of the PBOC also attended the meeting. Pan emphasized that the current global economic situation is becoming more complex and volatile. China will always adhere to true multilateralism and provide the necessary support to the IMF. He praised Georgieva's leadership and the IMF's crucial role in maintaining global economic and financial stability. Pan stressed that the IMF, as a quota-based institution, should accelerate and achieve quota adjustments, reflecting member countries' relative positions in the global economy and increasing the representation of emerging markets and developing countries.

⭕[Bao Gang United Steel: Q1 Net Profit Down 29.33%]Bao Gang United Steel (600010.SH) announced that its revenue in the first quarter of 2025 was 15.433 billion yuan, down 13.04% YoY; net profit attributable to shareholders was 44.9643 million yuan, down 29.33% YoY.

⭕[Henan: Introduce Measures to Promote Stable and Quality Foreign Trade, Improve Contact Mechanism for Key Foreign Trade Enterprises]The General Office of the Henan Provincial People's Government issued the "Several Policy Measures to Ensure 'Double Over Half' in the Second Quarter," which mentioned introducing measures to promote stable and quality foreign trade, improving the contact mechanism for key foreign trade enterprises, supporting the expansion of domestic and non-US markets, and launching special policies to support the expansion of auto exports, providing subsidies of up to 100 million yuan for production enterprises and up to 10 million yuan for trading enterprises. An action plan to boost consumption will be introduced, conducting the "Happy Shopping in Henan, Quality Life" second-quarter promotion activities, issuing retail, catering, tourism, and accommodation coupons, and implementing detailed rules for trade-in programs in home renovation, e-bikes, agricultural machinery, and old operational trucks.

⭕[Preview: 2025 Trade and Investment Promotion Summit to Be Held on May 22]The China Council for the Promotion of International Trade (CCPIT) held its April regular press conference on April 28, where spokesperson Zhao Ping answered journalists' questions. Zhao announced that, with the approval of the State Council, this year's Trade and Investment Promotion Summit will be held on May 22 at the Diaoyutai State Guesthouse in Beijing. The theme of this summit is "Embracing the Digital and Intelligent Era, Working Together for Common Development." The topics are hot, with the opening ceremony, plenary session, and three parallel forums. The plenary session will focus on "Digital and Intelligent Empowerment, Building a Safer, More Stable, Open, and Cooperative Global Industrial and Supply Chain." Parallel forums will delve into "Digital and Intelligent Drive, Creating an Open and Fair Innovation Ecosystem" and "Global Trade and Investment Cooperation in the Digital and Intelligent Era." The summit will also release the "2025 Global Trade and Investment Promotion Summit Beijing Initiative," calling on the global business community to explore new forms and areas of cooperation and promote stronger, greener, and healthier global development."We welcome media friends to pay attention and report on this at that time," said Zhao Ping.

⭕[CCPIT: Nearly 50% of Foreign Trade Enterprises Plan to Reduce Business with the US] According to a survey conducted by the China Council for the Promotion of International Trade (CCPIT), nearly 50% of foreign trade enterprises indicated that they would reduce their business with the US. Meanwhile, 75.3% of enterprises plan to expand into emerging markets to make up for the reduced share of exports to the US. The surveyed enterprises generally stated that the frequently changing tariff policies have significantly increased uncertainty, making it difficult for enterprises to make long-term plans. However, with the support of the government's package of policies to stabilize foreign trade, a large number of foreign trade enterprises are actively seeking solutions by exploring alternative incremental markets, expanding domestic sales, and enhancing the resilience of their supply chains.

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